Monthly Archives: October 2018

Richard Denniss, Dead Right: How neoliberalism ate itself and what comes next (Quarterly Essay 70, 2018)

If, like me, you expect an essay on economics to be dry and jargon-ridden, you will be relieved to find that this Quarterly Essay is witty, passionate and accessible. On the 2018 Sydney Writers’ Festival podcast of Richard Denniss discussing his previous book, Curing Affluenza, there are a number of Anna Russell ‘I’m not making this up’ moments: the audience laughs at a piece of snark about the workings of capitalism and right-wing politics, and Denniss protests that what he has just said is the simple truth. These pages bristle with the written equivalents of those moments. It would be hilarious if it wasn’t real

The main thesis:

Neoliberalism, the catch-all term for all things small government, has been the ideal cloak behind which to conceal enormous shifts in Australia’s wealth and culture. It has provided powerful people with the perfect language in which to dress up their self-interest as the national interest.

Neoliberalism pretends to be a coherent theory of economics that says the market should be allowed to function without government interference – hence deregulation and privatisation are always the way to go. But as preached and practised in Australia it is really a rhetoric to disguise greed and self-interest. Denniss multiplies examples of places where the proponents of ‘small government’ are all for government subsidy and regulation, so long as it goes to them or helps causes close to their hearts. The Murdoch media empire and Adani coal mine are only the most egregious instances.

Since I started drafting this blog post, Australia’s Prime Minister has dismissed the ALP’s policy emphasis on welfare, health and education as being about ‘More taxes, more taxes, more taxes, more taxes and more taxes’. He has also described the Sydney Opera House as ‘Sydney’s biggest billboard’. I could almost hear Richard Denniss’s pen scratching these utterances into his notes for future articles.

But yelling at the absurdities and cruelties of neoliberalism is a game we all play in front of our televisions every night. Denniss offers analysis and some steps towards remedy. The real power of neoliberalism, he writes,

has been to convince the media and large swathes of the public that … debates about the shape of our communities and the design of our institutions are somehow a ‘distraction’ from the main game of further tax cuts and industrial relations reform. Neoliberalism has produced the bizarre result that serious politicians and serious political parties define themselves by their ‘economic agenda’, while declaring simultaneously that it is individual choice, not government policy, that creates jobs and prosperity.

Faith in our democratic institutions, he argues persuasively, has been eroded:

The opposite of the narrow economic agenda of neoliberalism isn’t a progressive economic reform agenda; it is the re-establishment of a broad debate about the national interest. After thirty years of hearing that politicians, government and taxes are the things that ruin the economy, it is time for the public to hear and see that politicians, government and taxes are the foundations on which prosperous democratic nations are built.

The essay ends with a list of five new institutions that might help restore a vibrant democracy – institutions that Denniss would like to see introduced only if citizens are consulted at the beginning, the middle and the end of the process of their creation. The institutions, none of which are either left or right propositions, are:

• A charter of rights – to place our collective vision of our fundamental rights above any attempts to limit such rights based on the politics of the day. This would have protected us from the recent ‘robot-debt’ debacle, and would curb the current expansion of Peter Dutton’s powers.

• A National Interest Commission – to replace the Productivity Commission and provide ‘broad advice on the kind of advantages (as opposed to benefits) and disadvantages (as opposed to costs) that m=a major project like … an enormous new mine … might entail’.

• A federal corruption watchdog – hardly needs arguing for.

• Democratic education – that is, education in the workings of our democratic system, especially perhaps in the nature of the Senate and how Senate voting works.

• A sovereign wealth fund – ‘imagine if all tax collected from the mining industry went into the same fund from which all [mining] subsidies were drawn. Not only would there be much greater transparency and accountability concerning the subsidies, the revenue collected from the sale of our scarce resources also could not be squandered on short-term vote-buying.’

This QE was published in June. An advantage of coming to it late is that the next in the series has been published, with 47 pages of correspondence about Dead Right up the back (not bad for a 77 page essay). As always, the correspondence sheds new and interesting light on the essay’s subject. This is particularly true of John Quiggin’s account of how Tony Abbott’s prime-ministership dealt the death blow to Australian neoliberalism’s credibility. Interesting in a different way is John McTiernan’s attack, which is a brilliant example of a kind of political writing that distorts the writer’s enemy’s position and then tramples all over the straw man it has created: this is apparently quite effective in the opinion columns of the Australian, when readers of the attack can be assumed not to have read the thing being attacked – here it just makes Mr McTiernan look illiterate. On the other hand, The Australian‘s economics editor, Adam Creighton, is one of several economists who criticise  Denniss’s essay trenchantly without grossly misrepresenting it.

Denniss uses his right of reply deftly and with more courtesy than sarcasm. He says in his concluding paragraph:

It is a privilege to have my arguments tested by such diverse voices. The conclusion of Dead Right is that the opposite of neoliberal economics isn’t progressive economics, but engaged democracy. And engaged democracy requires exactly the sort of well-meaning debate contained in these pages.